The cost of a Starbucks coffee isn’t the only thing that’s been climbing in the past few years. Car insurance is also expected to increase by 5% in 2022. This brings the average annual insurance costs of an everyday driver up from $1,663 to $1,707.
Luckily, average doesn’t always apply to every individual. Other factors can affect insurance rates in each area. So, the rates you pay may not be the same as everyone else.
Common Factors That Affect Your Car Insurance Rates
Car insurance companies weight pricing in different ways. The most common factors that influence your rates include:
Your Driving Record
A history of moving violations and traffic accidents is the biggest factor that can increase your car insurance rates. Car companies view your driving records to assess your risk. If you have a long history of infractions, you’re likely to get an increase in your next payments.
Reckless drivers tend to have high insurance rates due to their bad driving habits. In worse cases, these drivers are denied regular coverage by insurance companies. Instead, they’re given non-standard car insurance. It costs more and (in some cases) covers fewer expenses.
The only bright side to non-standard auto insurance policies is that holders have a higher chance of making claims compared to those who hold regular car insurance.
Your insurance coverage will influence the rates you pay. If you choose expensive services, you can expect your insurance premiums to go up significantly. Yet, this doesn’t mean that you should skimp out on services that you need.
Some people tend to leave out services they think are unnecessary, e.g., collision coverage, comprehensive coverage, medical payments insurance, etc.
Consult a professional to help you determine how much coverage you need. This will not only protect you from unnecessary spending but also save you from accidents and other financial misfortunes.
Your insurance deductible will reflect on your insurance rates. The deductible is the amount you pay out of pocket if you submit a claim for automobile repair expenditures. Deductible levels commonly vary from $250 to $2,500. The bigger your deductible, the lower your insurance premiums.
Your auto insurance costs can be affected by the type of car you drive. Car insurance companies will look through their records of past claims from similar models. From there, they will assess the repair costs, theft rates, and payments received through claims.
Driving Experience and Age
Novice drivers tend to pay higher insurance premiums than older, more experienced drivers. Since you’re new on the road, insurance providers will assume that you’re more likely to get into accidents and crashes.
For instance, according to surveys from the Insurance Institute for Highway Safety, motorists under the age of 20 are three times more likely to be involved in a fatal collision.
Most Expensive Insurance Rates Per State
Here’s a little peek at the most expensive car insurance rates per U.S. state:
Delaware – $2,020
Florida – $2,020
Louisiana – $2,206
Maryland – $1,948
Michigan – $2,858
New York – $2,321
Rhode Island – $2,321
South Carolina – $1,955
Least Expensive Insurance Rates Per State
Here’s a list of the least expensive car insurance rates per U.S. state:
Hawaii – $824
Idaho – $953
Indiana – $1,017
Maine – $945
New Hampshire – $953
North Carolina – $924
Ohio – $1,031
South Dakota – $1,074
Vermont – $945
If you aren’t sure what your insurance rates will look like in your state, you can use this car insurance cost estimator to get a better estimate.
How to Lower Insurance Rates in 2022
The best way to lower car insurance rates is to practice careful and defensive driving. This helps you avoid accidents and other situations that could bring your insurance rates up. Besides that, you can try shopping around for better car insurance deals. Car insurance providers calculate rates differently. Thus, the rates you pay with another provider might not be the same with other providers.
You may also want to consider voluntarily taking a traffic school course. Traffic school is normally required for people who have a history of multiple violations. But when you take it voluntarily, it may entitle you to insurance discounts for a few years.